Will The Increasing Fuel Prices Push The RV Industry Into Another Crisis? Part 1

by Alan Wiener
(Everything-About-RVing.com)

Editors Note: This is the first in a series of 3 articles I originally wrote in 2009 about the crisis that the RV industry was experiencing.

With the recent dramatic increases in fuel prices and experts stating that a gallon of fuel could cost as much $5 to $6 by July; the question needs to be asked "Are we going to experience Déjà vu all over again in the RV Industry or have they learned their lessons from their past mistakes?"

RV sales had been declining prior to the beginning of 2008. In fact some RV manufacturers started having financial problems in 2007 and tried to cut costs where they could. The rumors starting flying that certain RV Manufacturers were in deep trouble unless they found some new sources of funding. But, the RV Industry still kept producing RVs in the hope that if you build them they will come. The writing was on the wall, but nobody was reading what it was saying

Then in early 2008 fuel prices started to escalate. There were rumblings about banks having problems with certain bad loans. The overall economy took a turn for the worse and unfortunately the RV Industry and several other US Industries were not quick to respond to the downturn in consumer confidence. Throughout 2008 the fuel prices continued to escalate with no end in sight. People were no longer looking at "fuel guzzling" RVs. Lending agencies were pulling out of making loans on "luxury items"

such as RVs. Throughout 2008 some RV manufacturers starting filing for chapter 11 bankruptcy. Even though, this crisis had really begun years earlier, the snowball started to grow rapidly in 2008. There was now a glut of new RVs on the market and no one was buying them.

When the reality finally struck the RV Industry that they needed to take drastic action; the RV Manufacturers started reducing production, laying off employees, shutting down factories and trying to find even more ways to cut their costs. For a lot of RV Manufacturers even these drastic cost cutting moves were too little too late. Now the RV Industry has been brought to its knees and is hoping that some miracle will happen to make this crisis go away.

The visitors to the EARV website are well aware of this crisis, in fact, here are some questions that they recently asked us.

Comments for Will The Increasing Fuel Prices Push The RV Industry Into Another Crisis? Part 1

We just purchased a tent to use for short trips instead of taking our motor home. We go to TX in the winter with our MH from IL. But we will do some great "side" trips this time using a tent instead of the MH. The MH will be parked more due to the steep rise in gas prices! I just do see them coming down anytime soon!

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Fuel Price & Useby: Anonymous

The price of fuel will be a factor in deciding how I will use my motorhome this year. The primary purpose is to travel to different parts of the country, but if fuel remains high then use will be more localized. A secondary use will be in a couple of years when I retire - then the motorhome will be used in an extended stay in Florida.

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Sad!!by: p.p.

i can see where it will hurt the camping business . People will have to use money for gas to go back and forth to work.the camping show were down in attendance and sales were down...as the announcement of $5.00 gas came out the week before the show ! How sad!

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Don't Worry - Be Happyby: Pat

I do not have a problem with the higher cost of the gas.

1) My husband and I have purchased an RV lot in an RV resort and do not plan to roam the roads with the RV. We will be living in it - fulltimers. If we want to go somewhere, for a length of time, we will hire a "hotshot" to move it. They will also be hit with this crisis and will compete even more agressively for your business.

2)When we go to purchase our new RV, we will be able to get a great deal. Negotiations will be even smoother.

3) I feel for those that will be having a hard time but, now is the time to wait it out, and watch the RV lifestyle change a little. Not to worry, it will change back and the price of gasoline will come down.

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